Friday, 22 January 2016

The price ain't right!

There are some interesting statistics in this article in the Morning Advertiser on a variety of beer-related issues. One set of stats covers the fact that lager sales are declining in favour of ales and craft beers, about which they state:While some Brits are losing their love of lager, there is a rise in styles such as IPAs (Indian pale ales) in particular.

One fifth of UK drinkers are not willing to pay more than £2.99 for a pint.

Three in 10 (29%) beer drinkers are prepared to pay more than £4 per pint.

In London, 27% are willing to pay more than £4.50.

More than one quarter (27%) of Brits drink ale or bitter.

One in five (20%) drink any type of craft beer.

I found the first point of particular interest. I have long felt that £3 is particularly difficult psychological barrier for many drinkers, and I have wondered whether that's the reason why my local has kept its cask ales below that figure for some time now, except for beers over 5%. I'll pay £2.95 without a thought, but if the cost is over £3, I'll always notice it. It won't stop me paying, of course, but if the price is more than £3 a pint for ordinary beers, I tend to feel it's dear.

One drinker in five is a sizeable proportion of beer drinkers, and this stat suggests to me that it may be a cut-off point for some who may feel driven to join the join the supermarket set. This point is reinforced by the fact that, although lager sales are suffering more than cask ale, the overall consumption of beer in pubs is in slow decline: the market is shrinking.

Pub owners, such as brewers and pub companies who tend to have little compunction about pushing up the prices they charge, should take this psychological price barrier into account, or risk biting the hand that feeds them.

On a related issue, I note that CAMRA is campaigning for another cut in beer duty; let's hope the government heeds the call.

Where I live (in south Manchester) it's rare to see anything under £3 outside Wetherspoon's, and increasingly common to see prices above £4. There's obviously a lot of area-based segmentation of pricing going on. Aren't market forces grand?

Is there any wonder that more and more people buy their beer in supermarkets. It's not that they are cheap, they sell it at the going rate, the problem as you have alluded to is the greed of, "Pub owners, breweries and pub companies", who with the help of previous Chancellors have priced many pub goers into the supermarket.

Unfortunately, CAMRA’s current campaign for a 1p cut in beer duty is completely irrelevant, given the news that three of the country’s largest brewing groups, Heineken, Molson Coors and Diageo, are set to raise beer process by 10p a pint.

Much as I support a cut in beer duty, I am not going to waste time lobbying and writing letters, set against a background like this.